A New Debt Ceiling Strategy Is 'Gaining Steam' With Republicans

Friday

Jan 31, 2014 at 12:01 AMJan 31, 2014 at 10:09 AM

Brett LoGiurato

House Republicans are rallying around a new plan on their approach to raising the debt ceiling, according to The Washington Post's Robert Costa — a one-year increase tied to a request on the Affordable Care Act:

House members tell me this is the GOP debt-limit plan: 1-year increase tied to "no bailout for insurance companies" under ACA

— Robert Costa (@costareports) January 31, 2014

Costa clarified in a subsequent tweet that it's not a set strategy, but it's one that was discussed and was popular among Republicans at their annual retreat in Maryland on Friday. He said it was "gaining steam."

That means House Republicans could demand a repeal of Obamacare's "risk corridors." Treasury Secretary Jack Lew has said that the debt ceiling will need to be raised by the end of February to avoid a potential default on the country's obligations.

The "risk corridors" in question aim to make it easier for insurance companies to transition to the new health-care system, largely by making it less financially risky for them to sell new insurance plans on the exchanges established by the Affordable Care Act. Republicans have recently begun referring to them as a "bailout."

The risk corridors are a temporary program that expire in 2016. Until then, the risk corridors are set up so that the government would compensate insurance companies that have bigger costs than they expected while transitioning to the new system. The provision is designed to protect insurers that see an especially unhealthy pool of customers and end up with claims that are higher than expected.

Democrats and President Barack Obama have remained firm on their position of not negotiating over raising the debt ceiling. Democrats believe that Republicans will eventually have to cave and pass a so-called "clean" debt-ceiling increase.

"They may find on this one that the nearest exit may be behind them," House Minority Leader Nancy Pelosi (D-Calif.) told Business Insider earlier this week.

"The more time Republicans spend dreaming up their latest debt limit wish list, the closer they are pushing workers and the economy toward another completely unnecessary crisis," Murray said.

"The American people are sick and tired of Republicans playing games with our economic recovery and Democrats have made it clear that Republicans don’t get to demand a ransom simply for allowing Congress to do its job. Hopefully Republicans will stop worrying about keeping the Tea Party happy and will work with us to prevent a default the way they’ve done the last two times, but this time without the drama and needless uncertainty."

See Also:

Why Republicans Have No Choice But To Cave On The Debt CeilingRand Paul Accuses Bill Clinton Of 'Predatory Behavior'One Of The Top Senate Democrats Just Called Republicans' Bluff On The Debt Ceiling